Intrum: Knowledge is power – why financial literacy matters…

At Intrum, we believe in the importance of understanding and taking control of your finances, no matter how grim things may seem. It’s always best to have a good understanding of your situation so you can work to improve it and ask for help if you can’t.

In a survey we conducted of 24,000 Europeans, many said the pandemic had motivated them to improve their financial literacy – 60% said they wanted to be in better financial shape if another pandemic happened.

Of the 24,000 Europeans surveyed in Intrum’s ECPR 2021

However, it can be difficult to decipher good advice from being overly cautious – 60% also said they would warn their child not to go into debt. While this makes sense when it comes to credit for clothes or expensive vacations, debt also allows people to buy homes, pay for education, and start businesses. It’s how you handle it that matters.

In Sweden, Germany and Austria, our interactive online courses for students and teachers help people learn how to manage their personal finances. The Spendido initiative aims to reduce youth debt and prepare the next generation for society as it is today.

In Spain we issued a financial guide targeting senior high school students, which explains, among other things, the risks of online gambling, investing in cryptocurrencies and other financial topics relevant to young adults.

In Hungary, we are running a competition to increase financial literacy. We also give lectures in schools in Denmark and the Baltic countries, because we believe it is important that children and young people learn financial management from an early age.

Despite this, it is never too late to learn. In Norway, Intrum works with the Red Cross network to offer support to convicts preparing for life after prison. In addition to education and job training, they learn about debts and personal finances, so they are in a good position when they are released.

Here are some of the things we cover:

  • There are different types of credit – take the time to understand the differences between store credit, loans, overdrafts, mortgages.

  • What is the true cost of credit? – calculate what your loan will cost you over time. It may seem affordable, but the long-term payment plans add up and can be an expensive burden.

  • What happens if I don’t pay on time? Your lender will issue an invoice and if you don’t pay, your account can be referred to debt collection and work with your lender to find a solution. Ignoring debt is never the solution. Talk to your lender or collection company to work out a payment plan you can afford.

  • Budgeting is a skill you can learn. Calculate the cost of your essential bills and how much that leaves you to spend. Then stick to your plan and once you’ve paid off your debts, the extra money can be put into a savings pot for unforeseen expenses.

Managing your money well opens up your options for the future. Once you are free from problematic debt, you will be better able to pursue exciting work and education opportunities, buy or rent a home, travel, and enjoy your life. It’s never too late to start!

Sarah J. Greer